AIR - Air NZ.

[fungus pudding]

Marilyn blows a congratulatory kiss at Roger

boop boop de do
Marilyn

I wanna be loved by you, just you,
And nobody else but you,
I wanna be loved by you, alone!
Forget Roger.

[Beagle]

http://www.4-traders.com/AIR-NEW-ZEA...amme-21906750/
http://www.4-traders.com/AIR-NEW-ZEA...arts-21906436/

and...consensus valuation view before today's announcement was $3.27 http://www.4-traders.com/AIR-NEW-ZEA...407/consensus/

It'll be interesting to see how the consensus view changes over the next few days after the analysts have reworked their projections. My sense is some institutions are currently overtly concerned by incoming competition. What C.L. said was this would lead to short term price pressure. e.g. Malaysian Airlines are back to charging nearly $3,000 return to Europe now in the shoulder season now that they think everyone has forgotten about recent incidents. Sure there will be launch specials to get routes started for the new competitors and then pricing will settle back to sustainable level's..well that's how AIR N.Z. management see it. They will price match, only when they have too and only short term.

[winner69]

The Cats Whiskers? More like Minx the Jinx

hahahah jokes mate.

Well there was more action after lunch eh

You be right vin, I'm on your side

[skid]

I figured out how we all went wrong.....We tried to use logic.

[Beagle]

http://www.nzherald.co.nz/business/n...ectid=11595451

http://www.nzherald.co.nz/business/n...ectid=11595418 Watch the video contained in the link. Looks like another new route will be announced in the near future.

[Bjauck]

http://www.4-traders.com/AIR-NEW-ZEA...amme-21906750/
http://www.4-traders.com/AIR-NEW-ZEA...arts-21906436/

and...consensus valuation view before today's announcement was $3.27 http://www.4-traders.com/AIR-NEW-ZEA...407/consensus/

It'll be interesting to see how the consensus view changes over the next few days after the analysts have reworked their projections. My sense is some institutions are currently overtly concerned by incoming competition. What C.L. said was this would lead to short term price pressure. e.g. Malaysian Airlines are back to charging nearly $3,000 return to Europe now in the shoulder season now that they think everyone has forgotten about recent incidents. Sure there will be launch specials to get routes started for the new competitors and then pricing will settle back to sustainable level's..well that's how AIR N.Z. management see it. They will price match, only when they have too and only short term.

Quite a few of the NZ shares I follow have 4-traders consensus valuations 10-20% above their current SPs - and some have delivered good results too.

[Beagle]

Quite a few of the NZ shares I follow have 4-traders consensus valuations 10-20% above their current SPs - and some have delivered good results too.

A cynic could make the case that if brokers valuations weren't higher on average than the average SP's then people wouldn't buy shares.
On the other hand here we have a company that's doing very well trading on, (by my estimate) a 2016 PE of only 4.5 !! so maybe this is the exception to the cynics rule (based on future ex divvy SP of $2.71 ($2.81 less the imminent dividend of 10 cps) and my estimate of 2016 earnings of 60 cps, (revised down slightly from previous estimate). $2.71 / 0.60 = PE of 4.52.

TBH I was hoping for $500m before tax today but $457m is still very good considering a big part of the extra $36m sales and marketing costs was to do with the set up and establishment of the new Housten and Bounes Aires routes. Without that we would have gone closer to $500m but its great that they're investing for future growth...that's what its all about !!

Of course the cynics will say that current earnings aren't repeatable in FY17 and yet most of the other airlines I follow are on forward PE's of 5.5 - 6.0 and aren't growing nearly as strongly as AIR.
My base case is AIR with recent growth and future plans can earn at least 35 cps on average right across the cycle and with a long term historic PE average of circa 10.5 that's fair value of about $3.68.

It won't surprise me to see one or two brokers currently sitting at $3.40 upgrading their valuation to around that level over the next few days.

Trading at $2.81 cum a 10 cent fully imputed dividend the shares look like good value to me.

[Raz]

Marilyn blows a congratulatory kiss at Roger for his staunch support of Cullen Airlines.

The major future vulnerability of Cullen Airlines is the introduction of A380's on the North American routes. While threatening this unlikely because North American airlines who are the most likely competitors on this route have a "not invented here" prejudice against this aircraft.

What about sand state airlines you ask, they are everywhere why aren't they flying this route? The North American airlines are paranoid about sand state airlines and own the finest Congressmen that money can buy, so that is not going to happen.

My hope that Cullen Airlines would be sold by John Key to Eitihad is in a prolonged holding pattern with nowhere to land. Low oil prices mean the backers of sand state airlines have no cash to splash on acquisitions.

Boop boop de do
Marilyn

Qantas could deliver an A380 if they wanted to AUC - LAX

[Raz]

I figured out how we all went wrong.....We tried to use logic.

What logic was that..

[skid]

What logic was that..

Just a bit of humor Raz ,but one would logically assume that a good result-an increase in div would have meant that the early increase in SP would have held. Thats what I thought would happen ,although I didnt think it was going to blast through the $3 mark.
I think more than a few were surprised.

But as to my earlier post-I think this stage coming is where we will find out whether they can continue to catch the same market share with the change in environment in terms of competition.

Thats not to say they are not a well run outfit ,as Roger has shown.

They have had a good run since Oct which reflects the anticipation of todays results. Now its all about the next results.